The retail landscape is dynamic, where customer preferences and shopping behaviors evolve quickly. Strategic rebrands can be the key to unlocking untapped potential and reshape the competitive landscape. In a recent article published by Fast Company, we learned about the ambitious rebranding initiative taken by Overstock and its potential impact on acquiring Bed Bath & Beyond. In this post, we’ll dive into the details and understand the implications of the move.
Bed Bath & Beyond has historically been a household name that is synonymous with affordable household essentials; however recently, there is immense opportunity to expand their customer base following the acquisition from Overstock. According to Attain’s real-time commerce panel, over 90% of Bed Bath & Beyond customers do not currently shop at Overstock—signifying a largely untapped market. Given their well-established brand recognition, Overstock has a vast opportunity to expose its range of products to a net-new audience.
Conversely, the data highlights a significant opportunity for Bed Bath & Beyond to diversify its offerings and attract a broader range of customers. Today, 5% of Overstock customers do not shop at Bed Bath & Beyond, which will allow this expansion to expose Overstock shoppers to home items like small-appliances and bath and bedding products—offering a strategic compliment to their closeout furniture and home decor and in turn, allowing customers to make additional purchases in a familiar environment.
There is a stark contrast in average transaction amounts—$205 at Overstock compared to $56 at Bed Bath & Beyond—underscoring the varying purchase behaviors of the two customer bases. Overstock caters to larger transactions, while Bed Bath & Beyond serves a market seeking smaller, more frequent purchases. These differences present a unique opportunity for cross-selling and upselling between the two brands.
Another noteworthy trend in the data is the shift from online shopping to in-store transactions. In-store transactions at Bed Bath & Beyond increased by 5% YoY, potentially due to post-pandemic foot traffic surging at their brick and mortar locations. This serves as a springboard for the brand to bolster its online presence, enabling it to compete with massive e-commerce players, like Amazon. Overstock’s inclusion in the online space may be the catalyst that propels Bed Bath & Beyond’s online footprint to scale, and reposition the brand as a formidable competitor in the digital retail space.
From a demographic perspective, Bed Bath & Beyond and Overstock attract female customers with an average household income of $50k+. Similarly, both retailers appeal to the Gen X generation, with Bed Bath & Beyond extending its reach to Millennial shoppers as well. Given the demographic congruence, there’s a strategic advantage that can facilitate a smooth transition of customers between the two brands.
Overstock’s rebranding initiative and acquisition of Bed Bath & Beyond holds immense potential. Attain’s data highlights not only the potential for cross-selling and upselling between the two retailers, but the broader opportunity to tap into new customers. As the retail landscape evolves, this strategic move positions both companies to remain relevant, regain competitive edge and adapt to changes in consumer behavior.